Aramco, Saudi Public Investment Fund to Found ‘Super Contractor’

A Saudi Aramco oil facility in Saudi Arabia. (AFP)
A Saudi Aramco oil facility in Saudi Arabia. (AFP)
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Aramco, Saudi Public Investment Fund to Found ‘Super Contractor’

A Saudi Aramco oil facility in Saudi Arabia. (AFP)
A Saudi Aramco oil facility in Saudi Arabia. (AFP)

Saudi Arabia’s Public Investment Fund (PIF) and Saudi Aramco are planning to set up a “super contractor” in partnership with local and international contractors.

MEED reported on Saturday that Aramco, PIF, a local contractor and an international contractor, will each own a 25 percent stake in the new entity.

Among the companies interested in this partnerships are: Al-Muhadib Contracting, El-Seif Engineering Co., Al-Rashid Trading & Contracting Co., and Nesma & Partners Contracting Co.

According to MEED, the new entity will replace distressed contractors, particularly Saudi Binladin Group and Saudi Oger, which have suffered financial difficulties in recent years and have been forced to scale back their operations.

The new entity is expected to take over major projects announced by the Public Investment Fund such as the Red Sea Project and Jeddah Downtown.

The new company will be responsible for the construction projects, which were assigned to Aramco. The construction sector will be separated from the mother company, and it is expected to recruit about 15,000 employees and employees.

Aramco plans to sell about 5 percent of the giant oil company, the cornerstone of Saudi Vision 2030, as a major reform plan led by Crown Prince Mohammad bin Salman, aimed at diversifying the Saudi economy away from oil.

Aramco has signed five memorandums of cooperation with Russian hydrocarbon giants during the Russian-Saudi Investment Forum. The agreements include: a trilateral MoU with the Saudi Public Investment Fund and Russian Investment Fund, for direct investments in the energy and industry sectors.

A MoU with the Russian Energy Giant Gazprom (cooperation in the field of Gas), and another memorandum with LITASCO (cooperation in trade); a MoU with Gazprom (for cooperation in the field of technology, research, and development); and finally, an agreement with Sibur and the Russian Direct Investment Fund (RDIF) (for strategic marketing of petrochemicals). These MoUs will allow all parties to jointly assess the potential for joint investments and marketing in petrochemical projects in both countries.

Sibur, biggest petrochemicals company in Russia, and the RDIF, inked on Thursday a memorandum of understanding with Aramco on the possible cooperation opportunities in Russia and Saudi Arabia.

In a statement, Sibur said both companies are planning to assess perspectives of the Russian and Saudi petrochemical markets, and to likely expand the cooperation in this sector.

Dmitry Konov, chairman-Mgmt Board at Sibur Holding said: “This partnership with one of the biggest Saudi petrochemicals companies will allow Sibur to develop its expertise and sales, along with studying the Middle Eastern market.”

Russian Energy Minister Alexander Novak said on Wednesday that Sibur would sign a $ 1.1 billion deal to build a plant to produce gas chemicals in Saudi Arabia.



Oil Falls Nearly 4% as Iran's Retaliation Focuses on Regional US Military Bases

FILE PHOTO: A meter shows the gas pressure in pipelines at oil and gas group MOL's gas transmission subsidiary in Vecses January 2, 2009.  REUTERS/Karoly Arvai (HUNGARY)/File Photo
FILE PHOTO: A meter shows the gas pressure in pipelines at oil and gas group MOL's gas transmission subsidiary in Vecses January 2, 2009. REUTERS/Karoly Arvai (HUNGARY)/File Photo
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Oil Falls Nearly 4% as Iran's Retaliation Focuses on Regional US Military Bases

FILE PHOTO: A meter shows the gas pressure in pipelines at oil and gas group MOL's gas transmission subsidiary in Vecses January 2, 2009.  REUTERS/Karoly Arvai (HUNGARY)/File Photo
FILE PHOTO: A meter shows the gas pressure in pipelines at oil and gas group MOL's gas transmission subsidiary in Vecses January 2, 2009. REUTERS/Karoly Arvai (HUNGARY)/File Photo

Oil prices slipped more than $3, or 4%, on Monday after Iran attacked the US military base in Qatar in retaliation for US attacks on its nuclear facilities, and took no action to disrupt oil and gas tanker traffic through the Strait of Hormuz.

Brent crude futures were down $2.91, or 3.8%, at $74.09 a barrel by 1:13 p.m. ET (1713GMT). US West Texas Intermediate crude (WTI) eased $2.8, or 3.8%, to $71.06, Reuters reported.

"Oil flows for now aren't the primary target and is likely not to be impacted, I think it's going to be military retaliation on US bases and/or trying to hit more of the Israeli civilian targets," said John Kilduff, a partner at Again Capital.

US President Donald Trump said he had "obliterated" Iran's main nuclear sites in strikes over the weekend, joining an Israeli assault in an escalation of conflict in the Middle East as Tehran vowed to defend itself.

Israel also carried out fresh strikes against Iran on Monday including on capital Tehran and the Iranian nuclear facility at Fordow, which was also a target of the US attack.

At least two supertankers made U-turns near the Strait of Hormuz following US military strikes on Iran, ship tracking data shows, as more than a week of violence in the region prompted vessels to speed, pause, or alter their journeys.

About a fifth of global oil supply flows through the strait. However, the risk of a complete shutdown is low, analysts have said.

A telegraphed attack on a well defended US base could be a first step in reducing tensions provided there are no US casualties, Energy Aspects said in a post.

"Unless there are indications of further Iranian retaliation or escalation by Israel/the US then we may see some geopolitical risk premium come out of the price in subsequent days," it said.

Qatar said there were no casualties from the attack on the US military base.
Iran, which is OPEC's third-largest crude producer, said on Monday that the US attack on its nuclear sites expanded the range of legitimate targets for its armed forces and called Trump a "gambler" for joining Israel's military campaign against Iran.

Meanwhile, Trump expressed a desire to see oil prices kept down amid fears that ongoing fighting in the Middle East could cause them to spike. On his Truth Social platform, he addressed the US Department of Energy, encouraging "drill, baby, drill" and saying, "I mean now."

Investors are still weighing up the extent of the geopolitical risk premium, given the Middle East crisis has yet to crimp supply.

HSBC expects Brent prices to spike above $80 a barrel to factor in a higher probability of a Strait of Hormuz closure, but to recede again if the threat of disruption does not materialize, the bank said on Monday.

Iraq's state-run Basra Oil Company said international oil majors including BP, TotalEnergies and Eni had evacuated some staff members working in oilfields.